The Commercial Rents Tax (also referred to as the Early Care and Education Commercial Rents Tax) generally applies to businesses leasing commercial space in the City and generally does not apply to businesses exempt from Gross Receipts and Payroll Expense Taxes. In addition to the existing Gross Receipts and Payroll Expense Taxes, this measure imposes a new gross receipts tax of:
- 1% on the amounts a business receives from the lease or sublease of warehouse space in the City;
- 3.5% on the amounts a business receives from the lease or sublease of other commercial spaces in the City.
This tax is filed as part of the annual business tax return.
Commercial space is any building or structure, or portion of a building or structure, that is not residential real estate, as defined in section 954.1 of Article 12-A-1. For the purposes of this tax, commercial space does not include any building or structure, or portion of a building or structure, that is used for:
- Industrial Use, as defined in Section 102 of the Planning Code
- Arts Activities, as defined in Section 102 of the Planning Code
- Retail Sales or Service Activities or Retail Sales or Service Establishments that are not Formula Retail uses as defined in Sections 303.1(b) and 303.1(c) of the Planning Code
- (Updated 4/29/19) Tax Collector Regulation 2019-2: Early Care and Education Commercial Rents Tax Regulation (Costs Passed On To Tenants Under Lease)
- Public Hearing Comments (April 5, 2019): Costs passed on to tenants under lease Reg 2019-1 and 2019-2 (Public Hearing Audio)
- Notice of Tax Collector Hearing on "Costs passed on to tenants under a lease" April 5, 2019 at 10:00 AM
- Commercial Rents Tax Credit and Exclusions: Credit for child care facilities. Exclusion of rents subject to hotel tax or parking tax.
- Statement by Treasurer Cisneros about taxes passed by the voters in the 2018 elections.
- Article 21: Early Care and Education Commercial Rents Tax Ordinance
- San Francisco Business and Tax Regulations Code Sections 6.9-1 through 6.9-5 of Article 6 for additional information on Determinations, Returns and Payments.
Estimated business tax payments are due April 30th, July 31st and October 31st. Residential Landlords with less than $2,090,000 in gross receipts are exempt from estimated quarterly business tax payments and will not receive an estimated business tax payment notice. 2023 estimated business tax amounts due will be payable on the business tax payment portal after March 1, 2023 for businesses that file their 2022 Annual Business Tax Return on or before February 28, 2023. For business that file their 2022 Annual Business Tax Return after March 1, 2023, estimated business tax amounts due will be payable on the business tax payment portal 48 hours after the 2022 Annual Business Tax Return is submitted. Learn more about quarterly estimated payments.
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